WORLD TRADE  
ORGANIZATION  TN/TF/W/18 
16 March 2005 
 (05-1098) 
Negotiating Group on Trade Facilitation Original:   English 
  
 
COMMUNICATION FROM KOREA 
  
 The following communication, dated 15 March 2005, from the Delegation of Korea, is being 
circulated in advance of the Negotiating Group meeting of 22-24 March. 
 
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CLARIFICATION AND IMPROVEMENT OF ARTICLE VIII OF THE GATT:   
REDUCING ADMINISTRATIVE BURDENS 
  
I. INTRODUCTION 
1. As addressed in Korea's previous communi cation concerning trade facilitation measures 
dealing with GATT Article VIII (G/C/W/403), WTO Members should emphasize the following 
principles in trade facilitation negotiations: 
• Non-discrimination: MFN and National Treatment; 
• Transparency;  
• Predictability; 
• Simplicity;  and 
• Reasonableness. 
 2. In line with the aforesaid principles, Korea presents the following area of discussion with 
respect to Article VIII:  
•  Reducing administrative burdens dealing with import and export formalities   
 
II. ISSUES AND CONCERNS 
3. Broadly speaking, there are two categories of administrative burdens associated with GATT 
Article VIII:  
• Paperwork associated with the documentation requirements;  and 
• Customs procedures. 
 
4. With respect to these burdens, we point out the following concerns:  
• Governments of importing and exporting countries may request information from 
traders that can be found easily from other sources, or from commercial documents already submitted to the government;   TN/TF/W/18 
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 • Traders may have difficulties in filling out  required documents because the terms 
used in the documents, as well as the layout of  the documents, are diverse in different 
countries; 
• Traders may have to submit import or expor t related documents to several different 
government agencies to receive the final approval for importing or exporting;  and 
• When the consignment of goods arrives at the port of the importing country, traders 
may not have a clear idea on the time fra me that it takes to process the goods and 
when the goods will be released. 
    5. These administrative requirements and uncerta inties increase costs and create adverse 
business environment for traders.  These costs and adverse environment have a disproportionate 
impact on SMEs, especially those of developing countries.  While larger firms can allocate more manpower for administrative requirements, SMEs ca nnot always do so.  Korea believes that there are 
some simple yet effective ways for WTO Members to reduce such burdens and uncertainties without 
much cost to the Member governments, and without sacrificing legitimate policy goals of the 
Members. Such measures include allowing the u se of copied documents in customs procedures, 
harmonizing and standardizing the documents of different countries,  adopting a 'single window', and 
utilizing risk management techniques. 
III. RELEVANT PROVISIONS OF GATT ARTICLE VIII 
6. The relevant provisions with respect to administrative burdens are paragraph 1(c) of 
Article VIII of GATT, which states that "The contracting parties also recognize the need for 
minimizing the incidence and complexity of im port and export formalities and for decreasing and 
simplifying import and export documentation requir ements", and paragraph 3 of Article VIII of 
GATT, which states that "No contracting party sh all impose substantial penalties for minor breaches 
of customs regulations or procedural requirements.   In particular, no penalty in respect of any 
omission or mistake in customs documentation which is  easily rectifiable and obviously made without 
fraudulent intent or gross negligence shall be great er than necessary to serve merely as a warning." 
IV. SUGGESTIONS 
7. Korea believes that much of this paperwork a nd document-related costs can be reduced if the 
following suggestions are implemented: 
• Acceptance of commercially available information and copies of documents; 
• Harmonization & Standardization of document formats;  and 
• Use of a 'single window' where traders can  submit all the necessary documents and 
data to a single agency. 
 
8. Reducing the burdens associated with customs procedures are perhaps more difficult than 
streamlining paperwork and docum entation requirements because cu stoms procedures often involve 
physical inspections, which are intrusive and time  consuming, and simple  provisions may not be 
effective.  Korea proposes that one of the ways to  expedite customs procedures is to establish and 
publish an average time required for clearing and re leasing of goods.  In addition, in the long term, 
Korea believes that all Members should adopt pre- arrival processing, post-clearance auditing and risk 
management measures, which will greatly facilitate tr ade.  Currently, some Members may not be in a 
position to adopt these measures, but Members should recognize the importance of pre-arrival 
processing, post-clearance auditing and risk manage ment measures.  Below, Korea will examine these 
suggestions in detail.  TN/TF/W/18 
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 1. Acceptance of commercially available information and copies of documents 
9. Except for some justifiable cases, customs au thorities should be able to forego certain 
documentation requirements whenever the relevant information (e.g., name of the buyer, seller, 
country of origin, quantity and description of the good s, and their estimated value) is already available 
in the context of the commercial transaction.  Especially, if customs authorities operate electronic 
information exchange systems, the acceptance of commercially available information may 
significantly reduce traders' documentation burden  without making additional demands on customs 
resources.  Commercially available information incl udes information, which is included in business-
to-business transactions such as bills of lading or commercial invoices.1 
10. Accepting copies of documents in lieu of origin als for import and export can also greatly 
streamline the customs process.  Cu stoms can, if necessary, always re quest the original documents at 
a later time. 
2. Harmonization & Standardization of document formats 
11. If all countries use documents with the same lay outs, with standard titles and classification of 
information requested from traders, the traders can  fill out the documents more easily, thus reducing 
manpower required for paperwork and reducing trade-related costs.  To standardize the format and 
layout of documents,  
• first there should be a standard list of data which are collected by governments;  and  
• standardized classifications and names for these data. 
 
12. The WCO Customs Data Model can serve such f unction.  Currently, the WCO is in the final 
stages of developing the Customs Data Model.  This  Model is expected to enhance the harmonization 
and standardization of customs data requirements.  Under this Model, the names and definitions of 
data elements required by the customs authoriti es will be harmonized to eliminate ambiguity for 
traders.  The utilization of this model will enab le a 'seamless data flow' between importing and 
exporting countries.  If the model is fully utilized in a country where IT is extensively used for 
customs procedures, traders need to enter information only once, and the same information can be 
used for commercial invoices, import and export documents, release of goods and tax purposes, 
statistical purposes, and trade regulation purpos es, since all information headings would be 
standardized.2  Even for countries that do not use IT exte nsively, the use of common data sets will 
allow closer cooperation between the customs aut horities of different Members and allow for better 
control of controlled or restricted goods.  Further, that country will be prepared for the eventual and 
inevitable introduction of IT in its customs procedures. 
13. Once the Data Model is in place, Members can consider 
• Harmonizing and standardizing the format  for their documents irrespective of 
whether it is paper-based or computer-based.  
 
14. In this regard, Members can use 'aligned documents' so that all Members use the same size 
paper, with common items of information set out in  the same relative position in each form.  The most 
widely used aligned document is the UN Layout Ke y for Trade Documents.  This Key even allows 
some measure of flexibility, as the Key has blank spaces for any country-specific information that a 
particular Member may require.  Further, even t hough the Key has spaces fo r various different types 
                                                      
1 OECD (2002) TD/TC/WP(2002)50/FINAL, p. 7. 
2 OECD (2002) TD/TC/WP(2002)50/FINAL, pp. 9-10. TN/TF/W/18 
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 of information, if a Member believes that it need not  gather some information listed in the Key, it can 
merely blank them out. 
15. Korea believes that the use of such data m odels and aligned documents will significantly 
reduce the costs related to documentation and pa perwork.  We also note that having all WTO 
Members share the same format and layout for documentation may reduce problems arising from 
language, since regardless of the language used, the codes used for info rmation and the physical 
layout within the document for each informati on would be the same for all Member countries. 
3. Use of a 'single window' where traders can su bmit all the necessary documents and data 
to a single agency 
16. Currently, customs procedures for most Members require traders to directly interface with 
several different agencies for documentation require ments.  To lessen this burden, Members should 
establish a 'single window,' which would act as a clearinghouse for all documents and data submission.  This means traders need to submit da ta only once on the basis of streamlined document 
formats, and this 'single window' agency woul d administer all information on the document. 
17. While the establishment of a 'single window' fo r information submission should help reduce 
administrative burdens and costs for traders, ma ny Members may not be in a position to actually 
establish such 'single window' in the near future .  Nevertheless, the Members should recognize the 
importance of such 'single window'.  Korea is cu rrently in the process of developing such 'single 
window', and Korea notes that the OECD observes 'single window' mechanisms would be easier to establish in developing countries than in advanced countries, because it is more difficult to overhaul 
an already-existing system into an integrated me chanism than to establish an integrated mechanism 
from scratch.
3 
4. Establishment and publication of average time  required for clearing and releasing of 
goods 
18. Korea proposes that Members establish and make publicly available the average time taken 
for clearing and releasing of goods.  The establishmen t and publication of the average time taken for 
clearing and releasing of goods enhances predictab ility and allows traders to better schedule the 
goods' movement.4 
19. Through the WCO Time Release Study: Guide to Meas ure the Time Required for the Release 
of Goods,  the WCO has guidelines in place to help its members measure the time required for 
releasing and clearing of goods.  Along the same lines, Korea uses a Time Release Survey  (TRS)  to 
measure the time required for clearing and releas ing of goods and to find problems within its 
procedures.  However, for most Members, the resu lt of the measurement is not usually made public.  
WTO Members may agree to make such measurements public. 
20. Note that this measure would involve minimal burdens on Members since it merely requires 
each Member to establish and publish its average ti me required for clearing and releasing of goods 
without actually reducing such time.  If ther e are irregularities in shipment or exceptional 
circumstances occur, Members would still retain th e right to delay clearing of goods.  However, 
Members may agree to a provision that, in cases wher e the release takes longer than the average time, 
traders would have the right to ask the customs au thority the reason why the processing time for their 
goods is longer. 
                                                      
3 OECD (2002) TD/TC/WP(2002)50/FINAL, p. 15. 
4 OECD (2002) TD/TC/WP(2002)50/FINAL, p. 13.  TN/TF/W/18 
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 5. Pre-arrival processing, post-clearance a uditing and risk management measures 
21. Korea believes that the Negotiating Group on Trade Facilitation should encourage WTO 
Members to utilize pre-arrival processing, post-clear ance auditing and risk management measures to 
accelerate the release of goods.  This set of meas ures will bring benefits to the traders and the 
government.  Post-clearance audits will facilitate th e expeditious movement of  goods at the customs 
because the clearance processing time will be shortened by  allowing the controls to be carried out at a 
later stage.  Post-clearance audits also reduce th e need for expensive storage space at ports and the 
risk of theft and spoilage, so they sh ould also reduce the cost of insurance.5  
22. These measures require Members to use extensive risk assessment and management 
procedures.  Korea realizes that not all Members may be prepared to utilize risk management 
procedures at this juncture.  However, with prop er technical assistance and capacity building support, 
developing and least-developed coun tries will be able to enjoy the benefits from such measures. 
23. Moreover, many additional trade facilitating measures on customs procedures, such as 
introducing authorized traders and reducing the requi red customs procedures for less risky shipments, 
require the introduction of pre-arrival processing, post- entry auditing, and risk management systems.  
Therefore, the Negotiating Group on Trade Faci litation should recommend that the Members 
introduce and utilize pre-arrival processing, post-entry  auditing and risk management systems and that 
the Members adopt these measures as soon as they are feasible for each Member. 
V. IMPLEMENTATION CONCERNS 
24. Korea believes that many of the measures we  have suggested can be achieved without 
significant financial or administrative burden.  Some measures such as the standardization of 
document formats may involve a substantial one time cost as Members introduce new formats or 
realign their previous formats, but once the new form at is in place, the additional costs of utilizing 
these formats should be minimal. 
25. However, many of the measures we have sugg ested may require Members to review their 
current documentation requirements and customs pro cedures.  For example, some Members may need 
to carry out time release studies for clearing and releasing of goods.  In these cases, assistance by 
relevant international agencies, such as the WCO and the World Bank, especially those of the least-
developed countries, may be warranted. 
26. Some measures may also require a deepening of human capital.  For example, for some 
Members, the operation of a 'single window' or th e adoption of risk management techniques may 
require training of their officials.  International organizations may hold training sessions for officials 
from the less experienced Members.  These training sessions should include short seminars to 
familiarize officials with key concepts; and appr opriate apprenticeships where officials from less 
experienced Members can work at the agencies of the more experienced Members and gain practical 
experience.  As the deepening of human capital requires time, developing countries may require a 
longer period of time to institute these measures.  Individual Members may have roles to play in the 
aforesaid training sessions as well.  Korea has provided some training sessions through the Korea 
International Cooperation Agency (KOICA).   
                                                      
5 OECD (2002) TD/TC/WP(2002)50/FINAL, p.18. TN/TF/W/18 
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 27. Korea would like to remind Members that th e developing and least-developed countries 
should take the initiative and point out the needs a nd priorities involved in instituting various trade 
facilitation measures and what elements are required to address these concerns. 
 
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